NEWS AND INFORMATION

IoT Devices and Recurring Revenue

Forrester Research notes that much of the early excitement surrounding IoT, particularly in business, has focused on efficiency and cost savings. New diagnostics will help improve utilization and maintenance of a host of expensive business assets. But in this age a focus only on cost savings is misplaced. The next stage of IoT w...
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6 Keys to creating a great B2B customer experience

B2B companies are witnessing a shift in the sales process from brand-driven to consumer-driven sales. Where outgoing marketing messages were once the primary means by which a customer learned about a business or product, nowadays, prospects glean that information from myriad sources, most notably each other. From photos to product specs to pricing ...
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Measuring Churn Rates and Actioning the Results

There is much talk about how to calculate churn, how to reduce it, and how bad it is. But let's look at how we can actually manage it, and what actions we can take given certain metrics. What to do if your Customer Churn Rate is… Low Churn Rate While your churn rate may seem low, and great if it is, it is still important to ensure that the numbers ...
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Subscription Billing is Not Enough

Subscription Billing is Not Enough
So you need a subscription billing solution … but is that all you need ? While being able to bill your subscriptions and collect payment is critical to your subscription strategy, consideration should be given to: How will your customers subscribe to your services How will your partners sell your subscription services How do you sell and provision ...
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Software and SaaS Vendors are disrupting themselves

Software and SaaS Vendors are disrupting themselves

Introduction

Before Cloud, Saas, Social Business or any of the myriad of buzzwords currently common to our business day came Apple Inc. with their consumer orientated devices, iTunes and AppStore and changed the buying and consumption habits of people around the globe ... forever. This in turn, has impacted heavily on the expectations of these same consumers when transacting in their business lives, the result of which has substantially affected the commercial models and operational complexities of the business software industry.In this paper, we will explore the impact that this has had on the software industry and how the disruption the industry itself is trying to create is in fact disrupting them at the same time. We will also look at how the internal systems of software vendors need to be enhanced to cater for this disruption so as to keep them relevant in this changing landscape.We call it the 4 Pillars of Disruption and is centered around the following broad factors:

New and multiple sales channels being usedDeployment of new license types and revenue modelsChanges in buyer engagementThe “Unanticipated” elements

 

Pillar 1 - Multiple Sales Channels

Whereas in the past the sales channel was a simple chain of events – it would typically go from vendor to distributor to reseller and finally to the end customer but that has now changed. While the legacy approach still exists, there is now also on-line, in-app and mobile transacting both directly with the consumer and indirectly through the supply chain. Then there are new go-to-market channels continually being created - consider that Google now offers a “Buy” button on search results.These are all great for getting products (cloud or on-premise) sold but how do you  manage these sales and how do you enable and engage your resellers and distributors across all those channels ?Pillar 2 - New License Types and Revenue ModelsGone are the days where you simply went out and bought a license to use a piece of software and installed it on your in-house computers.Today there are a myriad of options including mobile licences, on-premise licences, subscriptions licences, cloud licences and hybrid licences with a growing scenario of having part of the license on-premise and part in the cloud.The revenue models supporting these various license types only add to the complexity. Consider that in a single customer you could have on-premise products that are sold as subscriptions together with a cloud solution that is sold based on a multi-year contract (much like the legacy license model) and there could also be a cloud solution sold as subscription from an ISV.So not only are there mix and match license types but also a range of revenue and billing methods to go with it.This does provide choice for the market but how is this all managed in a way that protects the vendors product and revenue while engaging the supply chain and maintaining a quality and simple customer experience ?Pillar 3 - Changes in Buyer EngagementIn the past customers would have typically engaged with their trusted advisers early in the sales cycle to work through their requirements, have solutions demonstrated and to have proposals presented.Fast forward to today and what we find now is that customers engage much later in the sales cycle – they shortlist and do all kinds of investigation long before they start talking to the salesperson.There are numerous reasons for this change in buyer engagement dynamic including the fact that millennials are taking up decision making roles and are comfortable with the new approach to selection together with the fact that the information available today is easy to reach and rich in content and social networks provide instant feedback. Not to mention that the process does not require a “pushy salesman”.How does the software vendor track, understand and engage prospects and repeat customers before they pick up the phone to call the sales team ?Pillar 4 - Unanticipated ChallengesSome considerations vendors may not contemplate in this changing landscape, include ...Solution buildingThere’s an interesting statistic from IBM that 25 percent of all salespeople’s time is spent on solution building – trying to find the product/s that will enhance the core to deliver the customers solution. IBM also discovered that more than 65 percent of deals that are lost are lost because they could not find the solution.Considering Pillar 3, if it is this difficult for a salesperson, then it is likely to be substantially more difficult for a customer.Building the ideal customer solution would comprise the vendor products plus 3rd party (ISV) products and services (Partners). For cloud, this requires the ability to easily procure, provision and use multiple products from multiple vendors and ideally these should be included into unified license or subscription billing.Brand ManagementThird parties generate substantial revenue off the back of popular brands, however, the brand owner has little visibility of this and does not get to share in the revenue.There is an argument to be had that it is because of these third parties that the brand is successful in the first place but based on our research, the investment made by the brand is exponentially higher than the contribution made by the third party ... in essence, while useful to have the third party involved, the brand would survive perfectly well without the third party.Given the constant conflict between budgets and investing into the channel, vendors need to consider taking a share in the brand  revenue and using that to re-invest into the success of their channels.Building Repeat Website TrafficIt is far cheaper and effective to sell to an existing customer than to find a new one. However, once a customer has purchased their solution there is no ongoing compelling reason for them to visit the corporate website. Spam and privacy rules are also making it really difficult to send outbound hooks and in the B2B environment, social networking does not drive traffic in the same way that it does in the consumer space.In a study completed by CallidusCloud ... “Facebook and twitter do not bring in Leads” ... So to bring them back, new marketing and customer engagement strategies are needed.E-commerce and Payment ProcessingE-commerce is fundamentally changing B2B commerce. Businesses are continuing to shift resources from brick-and-mortar and other traditional sales channels to an e-commerce environment.A recent study conducted by Forrester Research shows that 89 percent of B2B providers said adding e-commerce to their business increased annual revenue by 55 percent. Meanwhile, 81 percent said selling online drove up their average order value by 31 percent.The benefits of E-commerce selling are big however doing this while offering multiple license types, different revenue models and extended sales channels needs a complete rethink of the operational systems of the organization.E-commerce also brings with it the need to have every transaction paid. However taking into account multiple payment methods, multiple payment geographies, local legislation, risk and fraud management, PCI compliance and a multitude of other challenges, highlights the need to ensure that this is all made easy both for the vendor and for the customer.

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Take Your Channel With You

In most cases, a multi-channel B2B Commerce strategy actually grows sales in a company's sales channels. However, to ensure that your channels adopt and promote your B2B Commerce initiatives, here are a few best practices that can assist in taking your channel along for the ride.

Let your dealers and distributors offer the best pricing. This is probably the #1 way you can avoid channel conflict as a B2B company. Undercutting on price is a huge no-no as it positions you as competition for your channel network. Refuse to undercut your local channel on price. Give your channel network the edge on price--they keep their foot traffic and you make up the difference in increased margin on online sales.

Promote your dealers and distributors on your B2B Commerce site. Your commerce site is going to catch a lot of attention from search engine crawlers and new customers alike. While B2B Commerce is a growing shopping method for a lot of businesses, there are still a fair number of who research online but still want to see a product in person before buying. Help those customers find a dealer near them and pass the leads on to your channel partners for follow-up.

Create special dealer- and distributor-only promotions--and then promote them online. While it might seem counter intuitive to promote in-channel sales and discounts on your B2B Commerce site, it's actually a good commerce practice for avoiding channel conflict. Your physical locations get the boost from real-time only offers and promoting it on your site lays the bait for those "researchers" who might otherwise defer their purchase until a later time.Provide the systems needed to effectively run a multi-channel on-line business. The B2B Commerce platform you use to run your marketplace and to deliver the features and functions needed by your channel and end-users is essential to ensuring that the decision and purchasing process delivers a great experience and so that you can properly manage your entire value chain.

B2B Commerce holds great opportunity for you and your channel if implemented properly. But one things is for sure, any software vendor that does not have a multi-channel B2B Commerce strategy will find their sales coming under increasing competition and if they do not take there channel along with them, they will lose a substantial part of their sales and service capability.

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Top Challenges of Payment Processing

Some of the biggest challenges facing B2B Commerce is the issue of payment processing.Payment transactions in the B2B space shares a great deal of the challenges with B2C but requires more complex options. Here are a few of the top issues and what to look for to resolve them.FraudThis is at the top of the list for all on-line traders however, in the B2B space this risk is substantially reduced as the relationship between the customer and the trader is usually more than just a "single transaction".Merchants need to implement a cost-effective yet robust fraud prevention system that can respond globally and on a local level.

As globalization increases, fraud solutions must be able to identify fraudulent activities when multiple local payment options are supported.Merchants must make sure their payment and fraud partners 1) can support their businesses on a global scale, and 2) have the local knowledge and experience needed to support increasingly sophisticated fraud schemes.Putting a registration and vetting process in place, you can substantially mitigate the potential for fraud risk ... Know Your Customer! Having these processes in place is also good for business as the contact details can later be used to expand the relationship and to build your on-line business community.

Multiple Local Payment Methods, Types and CurrenciesUnlike B2C payments, Business Commerce requires much more than just credit cards or eWallets. Business Commerce has three critical payment processing requirements 1) local payment methods, 2) multiple payment types and 3) multi-currency.Local payment methods allow customers to choose their favourite payment method in the geography that they exist. Customers are more confident using mehtods that they know and trust and this increases the customers potential to buy.Offering multiple payment types such as credit cards, eWallets, ACH, Check, Direct Transfer, Wire and others through local payment methods provides customers a wide variety of choice that they can use at the time of making a payment based on their current financial situation and preference.While the commerce site may not want to speculate on currency fluctuations and multiple currency price lists, to properly transact in a B2B environment requires localised pricing and payment. Where this is not provided, there is substantial evidence that sales are substantially negatively affected.

The effective ways to effectively manage these payment challenges are limited to two areas:

Your Business Commerce systems must provide flexibility in the the payment methods and types that it can offer, it must be able to integrate seamlessly with multiple payment gateways and it must provide localized pricing options.Your payment processor (or gateway) must provide a comprehensive range of local payment methods, payment types and currencies and must offer a complete mechanism to integrate to the Business Commerce solution including API calls, response codes and payment reconciliations.

PCI ComplianceWhile PCI compliance is widely known to be a requirement on any commerce site that accepts credit card payments, it is astounding as to how few on them actually have it implemented.Given the substantial ramifications of not having it, PCI Compliance is something that should not be ignored.Having your commerce solution and data centre vetted for compliance together with the ongoing maintenance of keeping the certification current can be very expensive. There are however some great alternatives:

Use hosted pages - Don't take credit card details on your own site, rather use the payment gateway hosted pages for payment processing.Use tokenization - Hosted pages are not efficient for all types of payments and transactions. Where this is the case, choosing a gateway that offers the ability for you to store a reusable token which can be passed to the gateway every time a payment for a specific customer is required will save you from having to take or store any credit card detail.Use other payment types - While PCI Compliance is great for protecting sensitive data (not just credit card detail) it is not required for all payment types so you can elect to use other types without having to implement PCI compliance.

The above issues constantly rank high as the major topics affecting payment processing. They are however easy to overcome by carefully planning three elements of you Business Commerce expansion ... 1) Choose a commerce solution provider that understands the complexities and that can assist you in rolling out your commerce site 2) Choose a commerce solution that provides the functionality that mitigates the issues mentioned above and 3) Choose a flexible and well renowned payment gateway that provides global and local solutions and that have the experience with global markets.

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5 Ways to Generate More B2B Deals

As global markets change and become more "local" so the demands on B2B will increase to meet these new opportunities. However, do it right and the reward of increased sales can be achieved. Consider some of these ...

25% of a salesperson's time is spent doing research - not only is this a massive resource cost on a collective basis to businesses around the world, but were you to provide comprehensive information that was easy to find and on which to make a buying decision together with an easy purchasing process in a single place and rather than scouring the world, the salesperson will see your commerce site as a preferred source.Google does not generate B2B deals - Google will direct a lead to your commerce site, what happens at your site is what will close deals. The better the decision making tools, the better the information provided and the simpler and friendlier the user experience, the more likelihood there will be of a deal being concluded.Only 35% of B2B social branding generates sales - Business makes buying decisions based on information, solution building, price and numerous other factors. If you consider that 65% of the sales are generated by these factors, then your B2B Commerce site and systems must provide the features to deliver the relevant content to your visitors.BRIC is growing rapidly - Use your B2B Commerce platforms to expand your business to the largest growing economies (Brasil, Russia, India and China). While your B2B Commerce platform needs to support localized payment, language and service needs, B2B offers you a way to enter these markets and to generate new opportunities.Use Multiple Channels - It is a global multi-channel road ahead to reach more customers through more touch points. Expanding your B2B allows you to go-to-market using traditional and emerging sales channels like resellers, on-line stores, subscriptions, in-product consumption, AppStores, social purchasing and mobile commerce.

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Why Should Software Vendors Create and Monetize Their Marketplaces

Apple has beyond any shadow of doubt proved that a monetized marketplace delivers great returns for them, an awesome go-to-market opportunity for their developer community and passionate customers.B2B software vendors, however, are slow to take advantage of this phenomenon. There are numerous reasons for this but that is another topic. Here are some reasons why software vendors SHOULD be looking very seriously at building their marketplace … even if it is only a small one.The Most Important Reason - Generate More DealsUltimately it boils down to two facts above all as to why software vendors should have a marketplace included in their multi-channel sales and marketing mix …

It generates more core sales; andIt builds a great echo-system!

How is this achieved … see the list below!Customer ExpectationsThe user experience expectations of customers is shifting and being driven by their consumer experiences at marketplaces such as the Apple AppStore, Android Markt as well as their purchases from on-line stores such as Amazon and Zappos.This is increasingly adding demands on software vendors to provide a similar user experience to their customers when they are looking for, evaluating and purchasing business software.Functionality Critical to Closing DealsNo single product can provide all the functionality needed to deliver the complex systems required by the modern business. Independent Software Vendors (“ISVs") form a vital part of the solution chain by adding those features and functions needed to close deals.Further, on average salespeople spend 25% of their time seeking out information to build customer solutions. This time is expensive and could be better spent on lead and deal generation activities.A marketplace that promotes both core and add-on software makes products and related information easier to find and evaluate thus making it quicker and easier to build solutions while also making the software vendor more competitive, customers happier and the ISVs motivated to continue investment into developing vital add-on solutions.Earnings to Invest Back Into The ChannelBudgets for channel development are always under pressure and yet for the average software vendor their channel is critical to revenue growth. So which comes first – investment into channel or revenue?A marketplace can and should be a profit centre where the extra earnings generated could be used to top up the lagging budgets for channel development, which in turn would have a positive impact on core revenue generation.Increased Internet Marketing – For FreeGaining high rankings in search engines together with the demands on software vendors to use social networks to promote themselves on the web is a time consuming and costly exercise.A well constructed marketplace that provides an environment for the vendor’s echo-system to congregate, communicate and transact would result in large volumes of traffic, links and in-bound content being created for the marketplace.As opposed to paid search, on-line advertising and paid staff to create blogs, tweets and other social network updates, this can be achieved at zero cost through the marketplace and the echo-system.Enhanced Service DeliveryThe web is a low cost and efficient way to deliver new or enhanced services to a software vendor’s echo-system. These services can include skills sourcing, project resourcing, training and support.This service delivery can improve the effectiveness of the channel and provide a convenient way for customers to consume products and services.The marketplace is a great way to deliver these services and as a by-product the traffic also creates the opportunity to on-sell additional products and services.

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Apple has proved it works for consumers. Now it is strategic for business.

Before SaaS, Social Business or any of the myriad of buzzwords currently common to our business day came Apple and to put it quite simply Apple has changed the buying and consumption habits of millions of people around the world and in turn, has impacted heavily on our business models.While Apple’s focus is on the consumer and the model does not directly translate to the business space, the influences they have brought to the business world include:There is an App for everything: If there is anything you want to do on your mobile device, the chances are that there is an App for it. These Apps are also easy to find, evaluate and purchase.Simplified decision-making: Because the Apps are easy to find and compare and the information provided about the products is comprehensive, the decision making process is made much easier for the consumer and the time to make the decision is substantially less.Money can be made by helping others to be successful: Creating an extensive developer ecosystem and then helping them to reach consumers has made millionaires of some of the most unlikely people. It has also delivered an invaluable service to the consumer at really good prices. And yet, as is easy to see, Apple has made billions out of it!Growing a passionate and loyal ecosystem: If we all had customers and suppliers as passionate as those that Apple has … well I guess we could all be an “Apple”. By delivering quality products at acceptable prices in a way that is easy, safe and reliable, Apple has endeared their ecosystem and been envied by their competitors.If your brand is used to help others – take a share: Apple has created a brand that is highly valuable and enriches the ecosystem. The building of the brand and maintaining its stature is not cheap. While the ecosystem is synergistic to Apple’s success, Apple has provided the framework within which the ecosystem can thrive and make substantial returns. It is only fair that apple take a share of this success.Can you strategically afford to ignore this phenomenon and not look at creating your own ecosystem driven marketplace.

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A Software or SaaS Marketplace is NOT just an AppStore

A Software or SaaS Marketplace is NOT just an AppStore

The common perception is that an AppStore is the start and end of a software marketplace. While an AppStore certainly forms a part of a B2B Software Marketplace, it is by no means the only important element of the marketplace. As defined by Collins, a marketplace is ...marketplace (ˈmɑːkɪt,pleɪs) — n, 1. a place where a public market is held2. any centre where ideas, opinions, etc, are exchanged3. the commercial world of buying and sellingWith this in mind, while a B2B Marketplace could exist with only an AppStore it really should include each of the elements in the definition to deliver a comprehensive service to a software vendor's ecosystem.Lets take a look at a few of the different components that could make up a marketplace and how each impacts on the software vendor.AppStore (or eCommerce driven product catalog)No single product can provide all the functionality needed to deliver the complex systems required by the modern business.Independent Software Vendors ("ISVs") form a vital part of the solution chain by adding those features and functions needed to close deals.Further, on average, salespeople spend 25% of their time seeking out information to build customer solutions. This time is expensive and could be better spent on lead and deal generation activities.If you consider that 65% of a buy decision for business software is based on information delivery, a marketplace that promotes both core and add-on software makes products and related information easier to find and evaluate thus making it quicker and easier to build solutions while also making the software vendor more competitive, customers happier and the ISVs motivated to continue investment into developing vital add-on solutions.Skills MarketThe people and businesses with a diverse set of skills that makes up the software vendor's ecosystem or supply chain is critical to the successful sale, implementation and support of systems for end users.Having visibility of these skills on a global basis provides an invaluable tool for ensuring that the vendor remains competitive by knowing where skills can be deployed or where training and recruitment may be required.Further, the ecosystem can advertise their projects, resources and skills and then share this information to better execute sales and project opportunities. This together with a comprehensive collection of information on the projects and skills available, makes it possible to quickly and easily find relevant information and to then review them in-depth. This will ensure that projects are efficiently resourced and that channel partners, with the appropriate skills, can be found and contracted.A vendor can also monetize this skills market and utilise these funds to reinvest back into the ecosystem.Self HelpHow many calls a day does the average vendor get from their ecosystem requesting information about invoices raised, licences sold, activation codes lost and account detail updates to name just a few.Providing a set of self help portals to each of the members of the ecosystem saves vendors the time and cost of dealing with these issues while delivering an added service to their ecosystem by making this information easily accessible.To have access to a portal would also require the community member to register for an account. This account can be designed to require the accountholder to enter various types of profile information and to subscribe to a marketing "opt-in". The profile information and opt-in provides a substantial benefit for executing marketing and promotional activities.Traffic Analysis and Lead GenerationProviding a range of touch points to attract the ecosystem and new potential customers and partners to the marketplace brings with it new sales opportunities.Effective measurement of the source of the traffic and profiling their activity in the marketplace would bring about intelligence that can be used to understand areas of interest, product demand, referring sources, marketing an promotional activity effectiveness and ultimately generate new sales.Given the clear and important benefits of having a professional marketplace, vendors that do not have a marketplace must realise the strategic importance of having one and for those that have started the process but still only provide an online catalog, it is time to properly construct and monetize the marketplace.

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Marketplace + Traffic + Monetization = Increased Sales and Earnings

A practical guide on how to use your marketplace (including your Enterprise AppStore) to grow traffic and generate new revenue opportunitiesFor business software vendors, generating repeat traffic to their sites is challenging but if it is achieved can be very lucrative.

“It is far more profitable to provide products and services to existing trading partners than to find new ones.”Trading partners in this context should be considered to include end-users, resellers (partners, system integrators), ISVs, distributors and current/ex-employees of these organizations.Of course, no traffic generation should exclude new trading partners so a broad approach to traffic generation, which envelopes both old and new will drive increased traffic and will leverage new revenue opportunities.So how do you increase return traffic to your website and how do you then monetize that traffic?“Having a great looking website or product catalog is not enough anymore!”Step 1: Create a MarketplaceThe first step is to create an environment … an “enterprise software marketplace” … that provides multiple reasons to encourage your partners to return. Some of these reasons could include, but not limited to:

Efficiently finding and purchasing add-on products to compliment their implemented solutionsRich content (not just web pages) to help buyers with the evaluation of add-on products and servicesFinding resources and skills to assist with projects, training and supportConnecting with the broad ecosystem to share information and experiencesTracking and managing the licenses for the products they have purchased or on-soldManaging the range of subscription, on-premise and mobile solutions being deployed

The marketplace should also provide your partners with an experience that matches that of their consumer web experiences (e.g. the Apple AppStore) by providing a broad set of functions to simplify the finding, decision-making and buying process.Choosing the correct marketplace platform with the appropriate functionality is critical to being able to achieve this. View this post for more information in this regard: A Software Marketplace is NOT just an AppStore !Step 2: Build Your TrafficSo now you have a marketplace and a functional platform on which it runs. Now for the real challenge, using that marketplace to attract the traffic. Here are a few ideas …Simple use of your existing marketing activities:

Create Blog, Twitter and LinkedIn posts that point back to your marketplaceAdd your marketplace URL to email signatures and all outbound marketing collateralPut a link to the marketplace on your homepageGet your partners to put links to the marketplace on their websitesInclude the marketplace in your next newsletter

Add “Rich” content to the marketplace:

Have your ISVs and complimentary product developers add their products and services to the marketplace and include videos, brochures, technical info, screenshots, downloads and more.List your resellers, distributors, system integrators and service providers with comprehensive information about them – not just a list with a link to their website!

Use your marketplace platform:

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Business Software Product Ratings Are a Bad Idea

In the enterprise software space, showing product ratings is not always a great idea.There are a number of reasons for this:

Implementations fail for many reasons and it is not only the product that is at fault. In most cases the cause is a combination of issues such as the end-user not specifying their requirement properly, a systems integrator that did not do their job properly or a budget that overran.As human nature goes, users are more likely to rate a failed implementation than a successful one so the product may in many cases have 1000 great sites but one bad one and that is the one that gets rated.The first product to get ratings will by and large make it extremely difficult for other equivalent products in the same marketplace to get traction. Potential customers will typically be presented with the highly rated products first and this prevents other products, which may in fact be better, from being given a fair chance at the sale.If products are continually beaten by others in the marketplace because of their "first to market" ratings, then there is no incentive for them to remain in the marketplace and as such you loose the developer and your ecosystem looses a potential solution.

This is not to say that all products are equal or that some should not be forced out of the market, but it does suggest that this is not the responsibility of a ratings engine to decide.

As an alternative, the following could be used:

Rich Content:All products in the marketplace should have rich content which properly showcases its features, benefits and successes. This content can include customer stories, public relations, product videos, vertical market solutions, brochures and downloads.Developer Programs:Define minimum standards through your ISV programs that dictate the status required in order to publish products in the marketplace.Developer Profile:Awards, years in business, number of customers, areas of expertise and the developer membership status can be used to profile the developer as an organization.

Although a bit more effort is required, there are many ways to properly provide relevant and rich information to customers so that they can make a quality purchase decision without risking the potential dangers of relying on a rating.

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Is Subscription Billing the holy grail for business software vendors and what does it really mean?

Subscription has become synonymous with SaaS (or hosted) solutions. There is however also a move to provide subscription options for on-premise and traditionally licensed products. While these have carried annual fees in the past under the banner of "Annual Maintenance Fees" or "Annual Upgrade Protection", a range of subscription options are starting to be offered which essentially include both the annual fees and the purchase of the license but leaving the current status quo of deployment in place.

In both cases there are many reasons why subscriptions make good business sense such as predictive revenue streams, better cash flow, fewer highs and lows in the analyst forecast charts for vendors and from the customers perspective, being able to spread his cash flow over time are a few of the financial benefits.

So how is this all tracking in the market ...

For small business software vendors such as Intuit, Wave Accounting, Xero, MYOB and others, the answer is GREAT !!

The uptake of these products has been exceptional and continues to enjoy strong growth in user numbers ... although it should be noted that profits are not nearly as impressive as one might believe.

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3 things that will transform the future of a business software vendor

With cloud, mobile, social and big data advances all happening at once and at lightning speed, how will shifts in technology impact the way software businesses are run?Ginni Rometty, CEO of IBM, recently made a prediction that three key areas will change everything. These three areas are:

- Data analytics will drive business decisions- Social Networks will impact on value delivery- Individuals will no longer be aggregated

Here is a look at how these may affect the modern software vendor.

Data Analytics – “business decisions and opportunity creation”

As potential customers use technology more and more in their assessment and purchasing processes as opposed to traditional face-to-face sales relationships, so the use of data will become more important to understand markets, drive content delivery and to predict futures.

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In-App Purchasing – Is it effective for enterprise software ?

While In-App purchasing is a growing and successful sales channel in the mobile consumer world, is it a viable strategy for enterprise software vendors?To keep this article in context, we will define an enterprise system as one where it is in use by a business and there are 5 or more users of the application.Well the jury is out on this … and based on early evaluations, with the different drivers surrounding enterprise software, it is unlikely to be as effective. What is more, if this is done at the exclusion of having a traditional product marketplace, then the sales model is more of a risk than an opportunity to the vendor.Here are some of the reasons why:New deals: For new customers that do not currently have any of the vendors products they cannot do any In-App purchasing as they have no App in which to do it! Where the solution requires a mix of products of the vendor and add-on products, then a marketplace rich in content and information is essential for any hope of selling to this customer.The purchase process: At the time that an application is required, there is typically a requirements process that is completed. Once done, then a search and evaluation exercise will get underway from which a purchase decision would be made and the internal purchase workflow would come into play. This does not augment In-App as a sales channel.Who makes the decision: The user is, in most cases, not the person that will be making the decision about a purchase and is also not likely to be the person looking for new functionality. As such, the In-App adverts are wasted on this user.Trusted advisors: Where the enterprise uses a vendor’s partner for their purchases, implementation and support, they will in most cases turn to them as their trusted advisor for assistance in finding, selecting and purchasing new applications.Volume: Typically, In-App adverts deliver products relevant to the section of the system in which the user is currently working. Any number of products could be available to enhance this part of the system and so the sheer volume and lack of the ability to filter this based on the users defined requirements would render the adverts ineffective. It is likely that the user would still navigate to a content rich marketplace to exercise a selection process.A frustrating distraction: If there is an “off” button, it is highly likely that users will turn off the distracting adverts. If there is no “off” button, then it is likely that the help desk will be receiving a few calls to find a way of doing it.In-App purchases of enterprise solutions may generate some demand by catching the right user at the right time with the right message but given the challenges, would need to co-exist with other sales channels and models and is unlikely to be the model that actually generates the enterprise add-on application sale.

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The Skills available in your ecosystem are critical to your success

People and businesses with a diverse set of skills make up the software vendor’s ecosystem or supply chain and these skills are critical to the successful sale, implementation and support of systems for end users.

Having visibility of these skills on a global basis provides an invaluable tool for ensuring that the vendor remains competitive by knowing where skills can be deployed or where training and recruitment may be required.

For service providers wanting to promote their specialist skills and for customers needing these skills, a web search engine cannot provide the fine grained results showing the availability of approved skills resources quickly and easily.

Where new projects are being resourced, simplifying the process to promote the project and invite responses for the provision of the services required for the project would make the customers life a whole lot easier.

A Skills Market would provide a substantial solution to these issues and would ensure that:

Projects are efficiently resourcedChannel partners, with the appropriate skills, can be found and contractedThe customers can quickly and easily find appropriate resources to assist with their projects

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Differences between AppStores, WebStores, Catalogs and Ecosystem Marketplaces

For Business Software Vendors, the need to implement a more encompassing ecommerce solution is becoming more prevalent every day.

This is being driven by a changing landscape in which the industry is seeing new sales channels, new deployment methods, new revenue drivers and new business models which in turn are affecting the rest of the business operations including marketing, channel management and accounting.

Once the vendor has recognized their need for an ecommerce solution to manage their changing business, they then face the challenge of figuring out which of the myriad of options out there best suites their business.

This is especially difficult for vendors that have an established and complex ecosystem of resellers, ISVs, end-users, distributors and skilled resources as the ecommerce solution selected needs to keep these entities involved in the transactions.

The following chart shows the types of ecommerce features needed by a channel focused vendor and the ability of different types of systems to deliver them.

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A Cloud Product Strategy Is not Enough

While the promise of new and large revenue streams for business software vendors is driving huge investment into developing cloud strategies it seems that there is much being overlooked in the process.

Building the cloud product strategy is just the starting point with a number of areas being sorely neglected and which will come back to haunt technology executives in the near term

As a part of a comprehensive roll-out, the following represents some of the items that should be addressed …

Most vendors will have existing legacy customers that will take time to cross over to cloud and there will still be a substantial demand from new customers that wish to stay with on-premise solutions.

The challenge here is how to build a hybrid sales channel that caters for both cloud and on-premise customers and where the customer can engage in an individualistic way.

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Are You a Dog - The Internet Does Not Care

So you are a small or medium sized software vendor and with tough competition out there you need to be perceived to be bigger and better to close more deals.Well if ever there was a reason to embrace the web trend for SMB software, this is definitely one of them. Business is becoming more and more comfortable with finding, selecting and procuring solutions on-line. The argument about traditional sales processes requiring trusted advisers to hold the customer’s hand from start to finish is becoming myth rather than reality … although many software vendors still find it hard to believe that the world has moved forward.Sure, in many cases, there is a need for the channel in both the sale and implementation of SMB software but they are getting involved much later in the sales cycle and customers are looking for products that do not require the same intense levels of channel or direct involvement as was needed in the past.We just have to look to the stellar growth that many “new age” SMB software providers like Xero, Box, Intacct, Salesforce.com and others are seeing to understand that the demand is there and that SMB software vendors need to embrace the trend and move their businesses in that direction.So, apart from product, here are a few pointers that should be considered to help make your business more competitive.Get active with SEO: If you want to be found this is essential and it does not have to burden you unduly. There are many great tools out there that are inexpensive and easy to use and with minimal time and effort will enhance your profile immensely.Give your website a revamp: This is the first perception that a prospective customer will have of your business. Use an open source CMS system, add a standard off the shelf professional template, convert your existing content into your new CMS and you are up and running.Add new quality content: More than 75% of an SMB's purchase decision is based on the information available on which to base his decision. By providing both quality and quantity content, the potential to sell grows exponentially.Implement an ecommerce solution: There are many studies that show how a multi-channels sales approach and a frictionless purchasing process can substantially increase sales. By implementing an ecommerce solution you can both add a new sales channel and simplify the purchase process for the customer.

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Saxum Commerce are leaders in providing solutions that are critical to the success of a digital vendor's commerce strategy while also assisting them in improving their customers' experience, reducing sales friction and driving revenue growth so that they can focus on their strategy and not the systems that underpin it.